The latest RBI bulletin pegged March 2026 credit card spend at just over Rs 2.1 lakh crore, another record month. The headline number is interesting; the composition is more so.

We’ve been tracking the category split published by the major issuers and aggregated by the payments council, and the picture for the trailing twelve months tells a different story than the one most retail analysts are pushing.

Travel and dining are the loud winners

Domestic travel spend on credit cards is up roughly 28 percent year-on-year. International travel is up closer to 41 percent, helped along by a stronger rupee and continued normalisation in destinations like Japan and parts of Southeast Asia that had been pricier through 2024-2025. The big ticket items - international flights, hotel bookings via aggregators, and forex card top-ups - dominate the growth.

Dining spend is up around 19 percent. That’s not just metro-led; tier-2 cities have started showing genuinely strong growth as the major QSR and casual dining chains have expanded their footprints. Zomato Pro and similar subscription food platforms have pulled significant share from cash payments.

Both these categories are sensitive to consumer confidence and to the festival calendar. The Q1 numbers got a boost from a strong wedding season that ran longer than usual, and from school holiday travel timing. April data, when it lands, will tell us whether the trend is structural or partly seasonal.

Education spend is the quiet structural story

The category that’s growing fastest in percentage terms but getting the least coverage is education. Tuition payments, ed-tech subscriptions, study-abroad fees and the associated travel are now showing up as a meaningful slice of urban credit card spend. Year-on-year growth is north of 50 percent, off a small base.

A few things are driving this. The major test-prep platforms have shifted to credit card as the preferred payment rail because of EMI optionality and rewards. Ed-tech has consolidated into a few large players who do real billing rather than the fragmented cash-and-UPI model that previously dominated. And study-abroad agents have moved their payment workflows onto cards to avoid the FEMA paperwork friction of bank wires under certain thresholds.

The implication for issuers is that the customer profile making large education-related transactions is exactly the cohort they want to retain - urban, salaried, late-twenties to mid-thirties, with strong income trajectories. Several of the premium card portfolios have been quietly restructuring their reward programmes to capture this category more aggressively.

Health spend is showing up too

Healthcare spend on cards has grown about 22 percent year-on-year. Some of this is genuine growth in healthcare consumption; some is a shift from cash to card as the diagnostics chains and hospital groups have built more sophisticated billing. Hospital stays still go through insurance for the bulk of the cost, but the patient-pay portion increasingly hits a card.

Pharmacy chains have driven growth too. The big online pharmacies have card penetration well above 60 percent on repeat purchases, helped by subscription auto-pay setups for chronic medications.

Traditional retail is not collapsing, but it is sliding

Apparel, electronics and general retail credit card spend has grown only mid-single-digit year-on-year. That’s well below overall card spend growth, which means retail’s share of the wallet is declining. Some of this is the BNPL effect, particularly for electronics where players like ZestMoney’s successors have eaten into card share. Some of it is reflective of softer discretionary retail demand in the metros, which the apparel chains have been signalling in their quarterly results.

Grocery is a special case - large format grocery has shifted decisively to cards and digital wallets, kirana is still mostly UPI and cash. The grocery category is growing but margin per transaction is thin.

What issuers are doing about it

The category mix shift is forcing a quiet repositioning across the major issuers. New product launches in 2026 have leaned heavily into travel-and-dining-rich reward stacks. Co-brand activity has picked up, with airlines and large hotel groups signing fresh deals after a quieter 2024-2025. The premium and super-premium tier has had the most product activity - that’s where the high-ticket travel and education spend lives.

There’s also a meaningful uptick in AI-driven personalisation work behind the scenes. Several issuers have stood up real-time offer engines that adjust reward multipliers based on individual spend patterns rather than the old static category boosts. Vendors providing this work include Indian fintechs, the major global card networks’ analytics arms, and a handful of international AI consultancies. Australian firms doing AI strategy work in financial services - groups like Team400 and others operating in the Asia-Pacific corridor - have started showing up in vendor selection processes for the technical architecture pieces.

The risk side

Worth flagging that the spend growth has been outpacing income growth in the urban cohorts that dominate card use. Outstandings are up faster than spend, which is the kind of pattern the RBI has been signalling caution on. Issuer credit cost guidance has crept up modestly in Q4 results, and the regulator’s recent commentary on personal loan and unsecured credit has been pointed.

The mix shift toward travel and education is healthy in some ways - these are productive uses of credit. But the underwriting models that worked when retail was the dominant category may need refreshing for a portfolio where the average ticket size is climbing and the spend is increasingly discretionary.

April and May data will tell us a lot. Watch the international travel category in particular - if it slows materially, the broader picture changes.